TMI Blog1984 (4) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... ch, 1963. You are, hereby, requested to produce your books of accounts for the above periods on 13th December, 1965', is a notice as required under section 18(1) of the Bihar Sales Tax Act, 1959? (2) If the answer to question No. 1 be in the negative, is the assessment order passed in pursuance of the said memo legal and valid?" 2.. As these questions are common in all the three taxation cases, they are answered by this common judgment. 3.. The assessee, M/s. Usha Sales (Pvt.) Ltd., was assessed to pay tax under the Bihar Sales Tax Act, 1959 (hereinafter called as the Act), for the periods 1960-61 to 1964-65 vide different assessment orders. We are not concerned with the assessment orders relating to 1963-64 and 1964-65. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... difications. 6.. Aggrieved by the appellate order as just mentioned above, the assessee (dealer) filed revisional applications before the Tribunal. The dealer made two grievances. The first grievance related to the common point in all the assessments orders, i.e., 1960-61 to 1964-65, and this grievance was with regard to the percentage of depreciation to be allowed by the assessing officer and the appellate authority on the original price of the articles to arrive at a sale price on the date of hire purchase transaction fructified into sale. 7.. In the present taxation cases, we are not concerned with this grievance of the assessee (dealer). 8.. The second grievance related to the reassessment of the alleged escaped turnover under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the assessing officer to reassess him for its escaped turnover. It was for the first time before the Deputy Commissioner (Appeals) that the question about the invalidity of the notice was raised by the dealer (assessee) and the Deputy Commissioner (Appeals) held that in absence of the objection before the assessing officer, it amounted to a waiver on the part of the dealer (assessee). 12.. The Tribunal on the basis of a few cases held that if at all there was any defect in memo (notice), it was only an irregularity in the issuance of the notice which was not enough to affect the legal validity of the notice. The submission of the dealer (assessee) was also rejected on the ground that the dealer (assessee) had not objected before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at a rate lower than that which was correctly applicable or any deductions therefrom have been wrongly made, the prescribed authority may, subject to such rules as may be made by the State Government...............reasonable grounds exists to believe. " Section 147 of the Income-tax Act, 1961: "If (a) the Income-tax Officer has reason to believe that, by reason of the omission or failure on the part of an assessee to make a return under section 139 for any assessment order to the Income-tax Officer or to disclose fully and truly all material facts necessary for his assessment for that year, income chargeable to tax has escaped assessment for that year, or (b) notwithstanding that there has been no omission or failure as mentioned in clau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or irrational. It must be subjected to objective test. It is true that the Court, of course, would not investigate into the adequacy or sufficiency of the reasons which have weighed with the assessing authority in coming to the belief but, the Court can certainly examine whether the reasons are relevant and have a bearing on the matters in regard to which he is required to entertain the belief before he can issue notice under section 18(1) of the Act. If there is no rational or intelligible nexus between the reasons and the belief (so that on such reasons, no one properly instructed on fact and law could reasonably entertain the belief) the conclusion would be inescapable that the assessing authority could not have reason to believe that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he jurisdiction to initiate the present proceeding and to pass the order. There is no estoppel against the statute. Absence of objection before the assessing authority could not vest jurisdiction upon him, if he had gone on the facts of the instant cases. In the instant cases, it could not amount to waiver as the assessing authority lacked in jurisdiction itself to initiate the proceedings in the absence of prerequisites being statisfied before the issuance of memo (notice) in the instant cases. 19.. In the result, therefore, the question No. (1) referred to us for our opinion is answered against the revenue and in favour of the dealer (assessee). As a necessary corollary question No. (2) is answered in favour of the assessee (dealer) and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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